The aftermath of the energy crisis and uncertainties regarding proper energy supply have heavily impacted commercial horticulture in 2023. According to the AMI Freshness Index, the inflation rate of fresh foods in November 2023 was preliminarily stated to be 3.9 percent and has stagnated at this level since September. At the same time, the inflation rate for the same period was significantly higher. "These two factors alone pose significant challenges for businesses. The expenditure exceeds the additional income," says Labinot Elshani, Chairman of the Board of Landfrisch AG and Managing Partner of the Vitarom Group.
Alongside geopolitical developments and war situations, massive changes in the financial sector cloud the future visions and associated investments for many gardening businesses. "In the under-glass area, we look back on a normal season in our group despite increased energy costs. In the open field area, we had to deal with heavy rainfall in the middle of the year and unusually high temperatures at the beginning of autumn. The late frost during the cherry blossom significantly reduced the yield," Elshani states.
Revenue increase of twelve percent
In times of inflation, consumers behave more sensitively and are uncertain, he also notes. "This is exactly where the industry, i.e., the supply side, the customers, and also politics, are called upon to act in unison so that end consumers are still maximally willing to pay a fair price for good, healthy, and Made-in-Germany products. In a rather challenging year, we managed to build up the structures of the producer organization broadly, professionally, market-conform, and future-proof."
Considering the socio-political changes and the associated framework conditions, the focus of the producer organization was on increasing efficiency in producer operations by focusing and specializing on fewer cultures per operation while simultaneously increasing the production quantity of the remaining available items. The producer structure of Landfrisch comprises 32 shareholders as affiliated producer operations and 33 producer operations in contract cultivation. The bundled marketing volume is approximately 106 ha of under-glass cultivation, approximately 800 ha of fruit cultivation, and approximately 2,000 ha of vegetable cultivation. In 2023, the two marketing organizations, Landfrisch AG and Vitarom Ltd, achieved sales of around 232 million EUR - this is twelve percent more compared to the previous year.
Johannes von Eerde and Labinot Elshani at Fruit Logistica 2023.
Thoughtful assortment expansion and development
Despite the aforementioned challenges, including extreme weather conditions, a positive development in the areas of open field and under-glass cultivation was achieved. Elshani: "The fruit sector also developed well for us in the first year. The actual sales were slightly below our expectations. This is mainly due to the very low stone fruit volumes. In 2023, we also started marketing organic fruit & vegetables for the first time. The sales share in the organic sector is currently less than five percent of total sales. However, this sector will soon be expanded."
As a modern and innovative producer organization, the focus of Landfrisch AG is primarily on further aligning the affiliated producer operations efficiently and in line with the market. This requires the greatest possible planning security and a specialization of the operations, emphasizes Elshani. "Our DNA is regionalism, and we believe this can best be combined with sustainability. For this, we are working specifically with our strategic partners to develop our product range in terms of quality, freshness, and taste - all of this proactively, as well as in a timely and demand-oriented manner. Because for us, repeat buyers are particularly important."
Based on the expansion and development of the product range, the significantly increased demand for high-quality regional products, as well as upcoming major events in 2024, such as the European Football Championship in Germany during the main season of fruit and vegetable production, Landfrisch AG expects a significant increase in fruit and vegetable consumption and a corresponding increase in demand this year. "In view of recent developments and protest actions, our expectation of politics is a transparent clarification of the population without constantly pursuing re-election as the main goal. We expect political foresight, i.e., an analysis of the feasibility of commercial horticulture, which also simultaneously has a supply mandate, before making far-reaching decisions."
At the same time, the expectations of the respective trading partners are for an honest and transparent partnership on an equal footing. "The sensitization to all existing costs should not lead to only the purchase prices of our trading partners having to decrease. Here, we need to find solutions collectively and in line with the market. In the end, it is important for all participants, in the entire chain, that everyone can cope with market prices," Elshani concludes.
Visit the company at Fruit Logistica: Hall 20, A-13
For more information:
Labinot Elshani
Landfrisch AG
Walter-Gropius-Straße 28
50126 Bergheim
Tel.: +49/2271/9955432
info@landfrisch.com
www.landfrisch.com